Question

Arrange the following items in correct sequence in which they are shown in Marginal Cost Statement:
A. Variable Cost
B. Profit
C. Contribution
D. Sales
E. Fixed Cost

• A. A, B, C, D, E
• B. D, A, E, C, B
• C. A, E, C, B, D
• D. D, A, C, E, B

Hint:

Logic Tip: Sales − Variable Cost = Contribution; Contribution − Fixed Cost = Profit.

Answer 1

The Correct Option is D

Step 1:
Marginal costing statement starts with sales revenue.

Step 2:
Variable cost is deducted from sales to obtain contribution. \[ \text{Contribution} = \text{Sales} - \text{Variable Cost} \]

Step 3:
Fixed cost is deducted from contribution to obtain profit. \[ \text{Profit} = \text{Contribution} - \text{Fixed Cost} \]

Step 4:
Correct sequence is: \[ D,\; A,\; C,\; E,\; B \] Hence, the correct answer is: \[ \boxed{\text{(4) D, A, C, E, B}} \]